The NSW government has released its Independent Panel's Interim Report into road classification and the transfer of regional roads to state ownership, including recommendations for the priority round of transfers and reclassifications.

As part of the report, it was suggested the road from Tomingley to Eumungerie be moved into NSW government ownership, including sections of road within the Narromine township.

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Currently the road - which at present acts as an unofficial bypass of the Newell Highway and Dubbo, and sees hundreds of trucks use the road daily - is managed by the Narromine, Gilgandra and Dubbo Regional councils.

However, the NSW government has accepted the recommendations of the report for the transfer of 391 kilometres of priority regional roads to state management, relieving the burden on local councils and ratepayers.

Following the report, Transport for NSW will now begin engaging with the relevant councils to plan for the transfer of priority roads, and identify those in need of any upgrades.

The move has been welcomed by Narromine Shire Council mayor Craig Davies, who said it would "significantly" reduce the financial burden on council.

He said the road was initially managed by the NSW government, before the council re-inherited it back about 10 years ago, and said they received almost $600,000 per year to maintain it.

However over the years, the freight industry had recognised the route was quicker, and trucks were using a significantly lower amount of fuel. As a result this left council with a road which needed significant rebuilding.

"What was once a sleepy little road into Narromine from the north and the south has become a fairly significant bypass of the Newell Highway and Dubbo," he said.

"On average there's 370 heavy vehicles use those two roads every day. It has never been designed to take the sort of weight that's involved in these trucks today."

Cr Davies said this also wasn't considering the trucks that came from the north-west along the Mitchell Highway, or trucks coming from Dubbo heading west.

"So there's a truck on that road every two minutes, every hour, every day," he said.

Cr Davies added with Inland Rail, and the council's aspirations of having a freight exchange located about 10km south of the town, it's anticipated the route will become busier with heavy vehicle traffic.

"So this is going to mean more trucks on the road, more wear and tear, and more cost involved in maintenance that the Narromine Shire simply don't have," he said.

The council has been investigating options around the potential upgrade of the Tomingley to Eumungerie road for several years.

Cr Davies also highlighted the work needed to be done along the route to rebuild sections, particularly prone to flooding.

"There have been times in the past two years where it's been so wet that council have had to limit the weight load on it to 10 tonne, because it's been seriously deteriorating the surface," Cr Davies said.

"Because it was never designed for these bigger trucks."

Member for Dubbo, Dugald Saunders said the Narromine Shire Council had been on the front foot to help secure the road transfer to the NSW government.

"The route between Tomingley and Eumungerie already forms something of an unofficial Newell Highway bypass around Dubbo, and we know hundreds of trucks are using it every day," he said.

"This has taken a toll on local roads, and the Narromine Shire Council has really been on the front foot to have this transferred to the state government.

"Most trucks need to come into Dubbo, but for those that don't, it's my hope that this alternative route will be a safer and more efficient one into the future."

Councils had been eagerly awaiting the first steps toward the takeback of regional roads promised by the NSW government at the 2019 election.

Despite announcing the take back of 391 kilometres of local roads, this was less than three per cent of the promised 15,000 kilometres.

Local Government NSW (LGNSW) President Linda Scott said this fell "woefully short" of what the peak body sector were hoping for.

"Almost 120 councils across NSW applied for priority road takebacks, but only five applications - representing just over 391 kilometres of road - met the government's criteria," she said.

Cr Scott said LGNSW would be seeking assurances from the NSW government that councils would not be worse off under road reclassification and takeback arrangements, and that council jobs were protected in the process.

"This outcome also raises real concerns about the government's subsequent commitment to help councils maintain local jobs by awarding Road Maintenance Council Contracts (RMCC) to them," she said.

"These contracts are vitally important to ensure councils are not financially worse off under road takebacks and, equally importantly, not forced to lay off road maintenance workers under new arrangements."